National Journal | March 14, 1998
ON FEB. 11, Attorney General Janet Reno called for an independent prosecutor to find out whether Interior Secretary Bruce Babbitt lied to Congress last year when he testified about a controversial Indian casino deal. For Babbitt and some other Administration insiders, the most important aspect of the case is presumably its outcome. For the rest of us, however, its broader implications matter a good deal more.
Assume, for the next few minutes, that the charges against Babbitt are true. If he is, therefore, guilty of corruption, then 535 Members of Congress, give or take one or two, and most of the executive branch's political appointees-- and, of course, their staffs--would be well advised to get lawyers.
Since the 1970s, criminal law has been reaching ever deeper into politics. The post-Watergate reforms brought a fine screen of campaign finance rules and, in 1978, the independent counsel law. The 1980s brought the ''zero tolerance'' prosecutorial mind-set, putting wetlands-fillers in jail with muggers and expelling students for bringing Advil or keychain pocketknives to school. The result is shown in the chart on page 567: a spectacular increase in prosecutions of public officials, stabilizing in the late 1980s at an unprecedented level (though dropping off a bit in 1995). Through it all, the public became convinced that all politicians are crooked, if you only dig a little.
Politics is not like arson or battery, however. Politics is a messy affair, in which no two people will draw quite the same line between lobbying and peddling influence, or between rewarding supporters and paying them off. As zero-tolerance advanced, it was inevitable that at some point the ethics process would lose the ability to distinguish in any predictable way between politics and crime. With the Babbitt case, that point has now arrived.
To say this is to make no judgment about what, if anything, Babbitt's independent prosecutor will come up with. It is to say that, no matter how hard even the most honest politician tries to obey the law, he can no longer go about his business without fear of one or more ruinous corruption investigations. The law's first duty is not to catch the guilty, but to provide a zone of comfort for the innocent. On that score, the ethics process has reached the point of collapse. Ethics investigations can bring down the honest and dishonest alike.
To see that this is true, you need not believe any of Babbitt's denials. Just the reverse: The best way to understand what has happened is by adopting the Alice-in-Wonderland theory of justice--verdict first, charges after. For the purposes of this article, the verdict is Guilty. That is, in all important disputes of fact, this article will assume that Babbitt's accusers are right about what actually happened. Wonderland jurisprudence is not fair to Babbitt, who has strenuously denied the charges; the box on page 566 tells his side of the story. For now, however, never mind which side you believe, and consider what it is that Babbitt is charged with, and what it means if those charges can ignite four separate corruption investigations.
Raising the Stakes
FROM the day it opened in 1991, the St. Croix Meadows Greyhound Park, in the town of Hudson, Wis., lost money. The dog track's owner, a Miami company called HAH Associates Inc., was losing something like $ 7 million a year. HAH attributed its ill fortunes to competition from casino gambling on Indian reservations nearby, and it decided to fight back by turning St. Croix Meadows into a gaming operation. Unfortunately, though, the dog track was not on an Indian reservation. So HAH made a deal with three poor Chippewa tribes, whose reservations were anywhere from 85 miles-188 miles from Hudson. The Indians would ask the Interior Department to take the dog track ''in trust'' for them, effectively making it Indian land. Then the place could be converted to a casino, and both HAH and the Chippewas would make money.
In due course, a regional office of the department's Bureau of Indian Affairs blessed the plan and, in November of 1994, sent it to the central office in Washington, which had the final say. A lot of money was at stake, not only for HAH and the Chippewas but, on the other side, for several Indian tribes that operated casinos near Hudson and did not relish the new competition. That winter and spring, a fierce lobbying battle took place. The casino's opponents--call them, for clarity in this article, the Winners--hired a small phalanx of Washington insiders, including Patrick J. O'Connor, a former Democratic Party treasurer who lobbied, among others, the chairman of the Democratic National Committee, the White House and, at a reception, President Clinton. In a letter, O'Connor pointedly reminded Harold M. Ickes, who was then the White House deputy chief of staff, of the Winners' ''previous financial support'' for Democrats and Clinton. For their part, the Losers hired one of Babbitt's oldest and best friends, a lawyer in Phoenix named Paul Eckstein, who lobbied the Interior Department, including Babbitt himself.
The department usually follows the recommendations of its regional offices. On the other hand, an application for an off- reservation casino was itself unusual. Such casinos are controversial with local communities, which fear that the Interior Department might use federal muscle to force casinos into unwilling towns or neighborhoods. Only one off-reservation casino had been approved--and that one with the community's support. The people in and near Hudson, by contrast, were bitterly divided on the dog track proposal, and the area's two city councils opposed it. On July 14, 1995, the Interior Department, citing local opposition, announced that the casino application would be denied.
Subsequently, between March and November of 1996, the Winners, renewing their ''previous financial support,'' donated $230,000 or more (various figures are cited) to the Democrats. The Losers, meanwhile, sued. Suit soon blossomed into scandal.
Those are the raw facts. To them, add one sharply contested piece of information, the only direct evidence of a link between the money and the decision. In July of 1995, on hearing that his clients' casino application was about to be denied, Eckstein rushed to Washington. On July 14, as the denial was about to be issued, he met with his old friend and pleaded for time. Babbitt refused. In his testimony before the Senate Governmental Affairs Committee last Oct. 30--which, in this article, we will assume to be definitive--Eckstein said: ''And his response was that Harold Ickes (in the White House) had directed him to issue the decision that day.''
Eckstein recalled something else, too. ''At some point, the Secretary said to me, Do you have any idea how much these Indians, Indians with gaming contracts . . . have given to Democrats? I said I didn't have the slightest idea, and he said, half a million dollars.''
Now the charge. It was spelled out clearly and accurately (with one factual slip, which, to avoid confusion, I have elided) in the Senate hearings by Sen. Pete V. Domenici, R-N.M.: ''The issue is whether or not this permit was denied to these three rather poor Indian tribes because of political pressure put on by the opposition, namely, other tribes who had permits; and whether or not that opposition ripened into campaign contributions and whether . . . high officials in this Administration, including possibly the Secretary of the Interior, acted adversely to the Indians based on that.''
A Crucial Distinction
THE first thing to notice here is what is not being alleged: bribery. The omission may seem strange, given the charge that money was tacitly exchanged for favors. But in fact the law, according to a number of experts I interviewed, is quite clear. On the facts alleged, bribery did not occur.
The Hudson case involves campaign contributions rather than gifts, a distinction that turns out to matter. Whereas politicians draw salaries so that they need not take personal gifts, campaign donations are an intrinsic part of American politics, for better and, of course, for worse. For exactly that reason, in a 1991 case called U.S. v. McCormick, the Supreme Court laid down a refreshingly bright line. A state legislator who had supported a bill favored by a certain group complained to the group's lobbyist that campaigns were expensive and that he had not heard anything from them. The group then coughed up a $900 donation. The official was convicted, but the Supreme Court overturned the verdict.
Campaign contributions--as opposed to personal gifts--do not violate the law, the Court held, unless ''the payments are made in return for an explicit promise'' of some official favor (emphasis added). Why ''explicit,'' instead of tacit, which would be the usual way to make such a promise? ''To hold otherwise,'' the Court said, ''would open to prosecution not only conduct that has long been thought to be well within the law but also conduct that in a very real sense is unavoidable so long as election campaigns are financed by private contributions or expenditures, as they have been from the beginning of the nation.''
The lawyers and scholars I talked to all agreed that the Eckstein version of events, in which Babbitt mentioned both White House pressure and campaign contributions but said nothing about a deal, does not even approach the Court's bright line. '''Abortion-rights groups are big supporters of mine,' or whatever--that's just politics,'' says Michael I. Krauss, a law professor at George Mason University. On the facts alleged, neither Babbitt nor Ickes could be convicted of bribery without reshaping the law itself.
Of course, even if criminal bribery didn't occur, the process might still have been politically tainted. And that, not bribery, is what is actually charged in this case.
Look back at Domenici's summary: ''The issue is whether...this permit was denied...because of...political pressure...and campaign contributions.'' In effect, the charge is improper political influence--not a criminal-justice concept at all, but still relevant, since it is improper for a federal agency to decide government business on the basis of partisan politics or campaign contributions. Assume, then, in keeping with Wonderland justice, that politics skewed the Interior Department's deliberations against the Losers, as they believe.
Charges of this sort are actually quite common. Aggrieved claimants often say that government agencies handled their cases unfairly or improperly, whether because of politics, animus or stupidity. And there is something they can do about it: sue. The Interior Department faces about 2,000 such lawsuits at any given time, according to John D. Leshy, its general counsel, of which a handful charge unfair politicking. In the Hudson lawsuit, the Losers are alleging that because of politicking they were left out of an important meeting, not given enough time to rebut the Winners' claims and otherwise not given a fair shake. If the federal court in Wisconsin decides that the Interior Department broke its rules or behaved unfairly, it will vacate the Hudson decision and send the department back to the drawing board to make the decision properly.
That civil procedure is an adjudicatory process about fairness, not a criminal or ethical procedure about corruption. No one goes to jail, faces a grand jury or is declared a crook. For just that reason, civil charges of improper political influence and the like can be handled routinely, without wrecking careers and reputations. Launching formal corruption investigations on charges of improper politicking, however, is a different sort of thing, and a departure with sweeping implications.
The Risk of Talking Politics
ON our Wonderland theory of justice, continue to assume Babbitt did in fact tell Eckstein, ''Do you have any idea how much these Indians . . . have given to Democrats?'' The comment might, of course, be evidence that the fix was in. Absent any pattern of venality, however, it might also be frank political talk between adults. If Babbitt's (alleged) remark is presumed corrupt, then it is also presumably corrupt for a Republican Congressman talking about his opposition to gun control to say, ''Fred, do you have any idea how much the NRA (National Rifle Association) has given this party over the years?''--or for a Democrat opposing school vouchers to say, ''The teachers' unions have been some of our best backers, so you bet we listen to them.'' If the ethics process is going to assume the worst about such talk, then honest discussion of politics is at an end.
Back in Wonderland, assume also that Babbitt did indeed say ''that Harold Ickes had directed him to issue the decision that day.'' Here an important detail swims to the surface: Ickes is not directing a particular decision, only a prompt decision. Eckstein himself told the Senate that the alleged direction was ''simply as to timing'' and that he had ''no basis to believe'' that Ickes had directed the substance of the decision.
Sometimes, of course, the timing of a decision can affect the outcome. Presumably the Losers thought so, or they would not have sent Eckstein to wheedle more time from his old friend. On the other hand, one reason we elect politicians is to prod bureaucrats to get things done. For a White House aide to tell a Cabinet officer to hurry up with a controversial and heavily lobbied decision involving a big contributor is a very long way from any traditional notion of corruption. Congressmen do it all the time. In fact, they are sometimes known even to drop strong hints about the outcome of a case.
''I know at times we made calls to EPA (Environmental Protection Agency),'' says former Rep. Timothy J. Penny, D-Minn. His office contacted the Environmental Protection Agency on behalf of businesspeople fighting wetlands battles, and it contacted the Agriculture Department on behalf of farmers trying to get their loans restructured. ''The list goes on and on of activities like this,'' Penny says, ''and you have to make a judgment call on what's meritorious.''
Politicians may misjudge the merits when assessing the grievances of their big donors. They may even think, ''I wouldn't waste my time on this trivia if the guy hadn't given me so much money.'' That may not be pretty, but it's politics, inherently and unalterably. The Supreme Court made precisely that point in McCormick, which specifically renounces an ''appearance'' standard where campaign contributions are concerned: ''Whatever ethical considerations and appearances may indicate, to hold that legislators commit the federal crime of extortion (McCormick was tried for extortion rather than bribery) when they act for the benefit of constituents or support legislation furthering the interests of some of their constituents, shortly before or after campaign contributions are solicited and received from those beneficiaries, is an unrealistic assessment of what Congress could have meant.''
On Capitol Hill, however, the ethics process now effectively stands McCormick on its head. If favors even appear to have been traded for contributions, let fly the congressional subpoenas, and the more, the merrier. Charles Tiefer, a University of Baltimore law professor and a former deputy general counsel of the House, says that as recently as the early 1990s, ''a congressional investigation was quite serious if it used even a couple of dozen subpoenas.'' In its current campaign fund- raising investigation, by contrast, the House Government Reform and Oversight Committee (whose chairman, Rep. Dan Burton, R-Ind., has himself been accused by Democrats of fund-raising improprieties) has issued 479 subpoenas, many of which land the recipient with legal bills in the four, five or even six figures.
Oddly, all but nine of those 479 subpoenas were issued to Democrats, according to the committee's Democratic staff. Still more oddly, none at all were issued to Members of Congress or their staffs. If congressional investigators are serious about the new corruption standards, they will have to do a more thorough job.
They might start with subpoenas for the 61 Senators who voted in 1996 to preserve the federal sugar subsidy, and who (according to the Center for Responsive Politics, a watchdog group) received an average of $ 13,500 in sugar-industry money from 1991-96, as against the $ 1,500 received by Senators who voted the other way. Then the investigators might summon the 213 House Members who voted for Northrop Grumman Corp.'s B-2 bombers, and who received an average of $2,100 each from defense contractors in the 1996 election cycle, versus less than $ 100 for the Members who voted the other way. Then they might pitch a tent outside the door of, for example, Sen. Alfonse M. D'Amato, R- N.Y., who (writes the center's Jennifer Shecter) received $ 42,800 in campaign contributions from executives of Alliance Capital Management three days after he introduced a bill exempting partnerships such as Alliance from certain taxes.
Asked about the Babbitt allegations, Penny replied, ''What he (allegedly) did is replicated day in and day out in virtually every office on the Hill.'' When Mark Twain called Congress the only ''distinctly native American criminal class,'' he presumably did not foresee that his assessment might come to be taken literally.
One Investigation Triggers Another
IN the wake of Congress's investigation of Babbitt, another charge arose: perjury. And that charge, not the original allegation itself, is what triggered the request last month for an independent prosecutor.
In a crucial respect, the perjury issue is different from the improper-influence issue: If the charge is true, than Babbitt clearly did commit a crime. In another crucial respect, though, the issues are similar. In both cases, a wide-ranging and potentially devastating corruption inquiry can just as easily be triggered by innocuous political behavior as by evidence of criminality.
Reasonable people can argue about whether Kenneth W. Starr, the Whitewater independent counsel, had enough to go on when he embarked on a major perjury investigation of President Clinton. Starr, however, had tape-recorded evidence that the President's alleged perjury was an integral part of a larger cover-up scheme. The Hudson case is something else again.
Very rarely would a busy public prosecutor pursue a perjury allegation without first having some fairly strong indications of a larger crime or cover-up (though he might poke around a bit). Even more rarely would he embark on a broad corruption investigation merely to back up a perjury charge. But, in the Hudson case, both are happening. Like Escher's two hands sketching each other, the perjury investigation and the corruption investigation justify each other. Never mind that the conduct of which Babbitt was originally accused is almost certainly not criminal: In effect, the investigative process triggers itself.
This needs a bit of explaining. Tracing the logic takes some effort, but is worth the trouble.
Most people assume that Babbitt's perjury problem is that he changed his story about his conversation with Eckstein, or seemed to change it. Actually, though, that is not the issue. Instead, as Reno explains in her request for an independent prosecutor, the problem is that Babbitt's revised story conflicts with Eckstein's story on one point.
Recall that Eckstein told the Senate committee last Oct. 30, ''And his response was that Harold Ickes had directed him to issue the decision that day.'' But that is not what Babbitt, who also testified on Oct. 30, recalled saying. Babbitt's version was: ''What I believe I've said is that Mr. Ickes expects me, or Mr. Ickes wants me, to make a decision.''
Reno notes that there is a crack of daylight between those two accounts. ''Expecting'' probably wouldn't suggest arm- twisting by Ickes, but ''directing'' might, so the word choice is relevant. Moreover, says Reno, ''if Eckstein's testimony is true, Secretary Babbitt's testimony on those points would be false.'' So that would be false testimony on a matter of concern to a Senate investigation--potential perjury, if Babbitt had criminal intent.
The difference between ''directed'' and ''expected'' might not imply criminal intent, of course. Both Babbitt and Eckstein enjoy reputations for honesty, and by the time of their Senate testimony, the conversation in question was more than two years old. When I asked two memory experts whether the difference between ''expected'' and ''directed'' in a years-old conversation can be assumed to be suspicious, they said, in effect, of course not.
''The verbatim words of a conversation fade away very quickly,'' says Elizabeth Loftus, a University of Washington psychologist who is the president-elect of the American Psychological Society, ''and what you're left with is the gist of the conversation''--or rather the interpreted gist, because even the most honest and sincere people remember themselves in ''prestige-enhancing'' ways. (They often recall voting in elections when they didn't, for example, or giving more to charity than was the case.) I asked Robert A. Bjork, a psychologist at the University of California (Los Angeles), about ''directed'' versus ''expected.'' ''That is such a subtlety--you could have both sides be entirely confident and sincere, and nobody was lying,'' he said.
Reno, however, is required to assume the worst about Babbitt's motives if she is in doubt. To set the case aside, she notes, she would need ''clear and convincing evidence'' that Babbitt lacked criminal intent--and she is ''unable to conclude'' that the evidence is clear and convincing, because (she implies) Eckstein's testimony is plausible. So, under the terms of the independent-counsel law, she must appoint a prosecutor to settle the matter.
And now a final step--one that, by jujitsu, turns a narrow perjury question into an expansive criminal inquiry. To find out if Babbitt's ''expected'' was a deliberate lie, the prosecutor will need to know if Babbitt had anything to lie about. To do that, he will need to investigate ''any potential criminal violations in connection with the underlying casino decision.'' Though the prosecutor's mandate is narrow, his authority is very broad.
Here, in microcosm, is the closed-loop logic that has given recent corruption investigations their peculiar quality of self-propulsion. The Hudson case has already been formally investigated by the FBI, the Senate and the House. Some of the people involved in the Hudson matter, including mid-level civil servants and political appointees who aren't accused of anything and never will be, have already been deposed three times. (In the Hudson case, one career staff member of the Interior Department has so far been questioned under oath for a total of 16 hours.) None of the investigations found a crime, and indeed it is doubtful that any crime was alleged to begin with. Nevertheless, the mere suspicion of perjury in the second investigation triggered yet a fourth investigation.
Far from being odd, this hall-of-mirrors pattern is becoming the standard. ''The same ground gets churned again and again and again by multiple and redundant inquiries,'' says Tiefer, the Baltimore law professor. ''And the subsequent investigations go over the responses to the previous investigations, producing what looks to the people caught in it like a never-ending cycle of being investigated for what was said in the last investigation.'' The ''Travelgate'' scandal, he says, produced five successive investigations. The Hudson matter is at four, and counting.
Babbitt is a wealthy man who aimed for national prominence in a game that he knew to be hardball; but the same is not necessarily true of the bureaucrats and political functionaries at Interior who are swept along behind him. An hour before a grand jury typically costs $1,000 or more in legal fees, according to a recent report in The Kansas City (Mo.) Star. As the subpoenas dropped on their doorsteps, more than a few Clinton Administration officials have been landed with legal bills ranging well into the six figures. Mere innocence is no protection.
''The legal bills are shocking to relatively junior people, who find themselves paying for lawyers both for grand jury appearances and congressional depositions, even though they themselves have done absolutely nothing wrong and are mere bit players,'' says Tiefer. ''We're not talking about rich people. These are people for whom the legal fees represent a sizable amount of all they have in the world.'' Or had, as the case may be.
Circles of Fear
AT the end of the day, Babbitt or somebody else may be found guilty of a crime. But undiscriminating investigations are not excused by the fact that they unearth wrongdoing, any more than McCarthyism was excused by the fact that some of its targets were Communist agents. Nor are such investigations excused by ultimately clearing their targets, if, along the way, they have tormented or bankrupted scores of people who are guilty only of politics.
Bruce Babbitt is not Alger Hiss, and mindless legal process is not opportunism or paranoia. But imagine, for a moment, that you set personalities and circumstances aside, and just put 1950s McCarthyism and 1990s ethics investigating side by side in black boxes, so that all you could see is how both systems behave. Then certain similarities emerge. Formal investigations can be triggered by ordinary political conduct, with no showing that a crime has been committed; once the investigation begins, it justifies its expansive scope on the grounds that, after all, some people are guilty; the investigation exacts from even the innocent a toll in money and time and anguish that is itself often hard to distinguish from a form of punishment; above all, a cascade of investigations-of- investigations creates a maze of infinite jeopardy. At no stage is there protection from bankruptcy or exhaustion, or shelter from the radiating circles of fear as the subpoenas pour forth.
What to do? The independent-counsel law will almost certainly be revised and narrowed next year, when it is due to expire; it could be repealed altogether, or its hair trigger could be changed so that, for instance, no investigation would be allowed on less strong suspicion, or on less serious charges, than a busy public prosecutor would ordinarily pursue. In other words, it could presume innocence rather than guilt.
As for formal congressional investigations, which are hardly less onerous, they could be required to provide standard due-process protections, so that subpoenas could not be issued willy-nilly by curious congressional staffers, witnesses could not be badgered under oath, and formal investigations could not begin in the first place without strong indications of criminal intent and activity. (Congress would still be free to conduct informal investigations, such as ordinary hearings, and to criticize anybody for anything.)
More broadly, multiple jeopardy might be restrained, so that echo-chamber investigations could not repeat each other ad infinitum. Restraints might also be placed on the investigation of ''naked perjury,'' so that free-standing perjury allegations could not be telescoped into open-ended searches for possible cover-ups. Arrangements could be made to help pay legal bills for people who are investigated but never charged. And so on.
None of that, however, would be enough without a further change: a recognition on the part of the broad public that politics will never be a virginal enterprise and that, while voters can and perhaps should be cynical about politicians, formal investigative processes must never be. When politicians' natural behavior becomes probable cause for inquisition, ethics investigations become random eruptions, avoidable only by avoiding public life altogether. Whether the ethics process has quite yet become legal McCarthyism is debatable, but the Babbitt case clearly hovers over the abyss.
